Small-time Mayo Manufacturers Perfect the Recipe for Paying Higher Wages

By Natalie Fertig

When Elizabeth Valleau and Sam Mason decided to start a small food business three years ago, they spent a good deal of time deciding how much to pay their employees.

“We were not interested in pretending to be an ethical company and then not treating our employees that way,” said Valleau, now one half of the business team behind Brooklyn’s profitable Empire Mayonnaise. The young business pays their employees on average $15-20/hour. Valleau says it is a good business strategy.

Valleau, a product designer and marketer by trade who previously worked in food service, and Mason, a long-time restaurateur, had both seen people mistreated in the manufacturing and food industries before. They wanted their entire business to be different, not just their mayonnaise.

So in addition to concocting creative mayonnaise flavors – they are famous for White Truffle, Red Chili and Bacon – they asked each hiree to describe his/her monthly expenses. From hearing how much employees spent on rent and transportation, the mayo duo decided on a minimum wage of $12 for their business. Today, their 10-person staff of cooks, packaging and manufacturing workers and retail assistants make on average $15-20 per hour.

Average wage in 2011 for Brooklyn’s food industry workers was $11.95/hour, ranging from $8.90/hr for food services up to $16.78/hr for food manufacturing, according to an analysis done by the Fiscal Policy Institute. This is almost a dollar less than what MIT calculates the “living wage” is for Brooklyn, and substantially less than the average wage Empire Mayonnaise pays its workers.

Higher wages have improved the work environment of Empire Mayo, according to its employees. Store manager Christel Arias, 26, previously spent two years employed by Fairway Markets, and a few years as a salesperson at Apple Stores before that. She says that at every previous job, the ones making minimum wage also had the hardest jobs.

“I personally would just not be really motivated,” said Arias, adding that working at Empire Mayo “is definitely ten times better. I actually enjoy what I am doing.”

Increased wages, however, do not always include increased healthcare. “We would like to offer it in the near future,” said Valleau. “It would make more sense if we were making a bunch of money,” she added with a laugh. “If there was some golden cash cow you got automatically from slapping ‘artisan’ on your product. But this is extremely difficult.”

Even so, Arias said she is probably the only one at the company without healthcare – and that is simply because she missed the window with the health exchange. Most other employees have healthcare through the health exchange, but make too much to qualify for Medicaid.

Despite the difficulties, Valleau said that paying more has helped her retain employees for longer and given them more incentive to do their best work – which is integral to a start-up business.

“Each one of our employees says that even though the hours are long, they feel appreciated and are part of something special,” she said. “And I think they give 110 percent.”

“The main difference from a corporate job,” added Arias, “is here we’re all a team.”

Brooklyn-born Valleau, the only daughter in a family of six children, inherited her Mayonnaise love from her French mother, but her business ethics from her father. Raised in Chicaco, he told Valleau stories of a donut shop owner who fed his workers breakfast every morning, and as a result kept most of the same workers for over twenty years. Valleau remembered this and made it part of her own work ethic. As a result, Empire Mayonnaise, which operates both its manufacturing and sales out of a 300-square-foot space in Prospect Heights, has never had an employee quit in its three years of business, and continues to turn a profit.

The company’s sales have continued to allow them to pay employees more. Customers have proved willing to spend $5 or $7 per nine-ounce jar of mayo, the same price as a 30-ounce jar of Kraft Mayo costs at a local grocery store. Gaia DiLoreto, owner of By Brooklyn, a Carroll Gardens shop that sells Brooklyn-produced products like Empire Mayonnaise and Mast Chocolates, says that customers expect prices for local, “artisan” products to be higher than you would pay at a grocery store.

“They come expecting to pay for the quality,” DiLoreto said. This has helped businesses like Valleau’s create enough revenue to pay employees over the $8/hr required in New York State.

Like fellow high-wage food purveyor Shake Shack, which pays employees a starting wage of $10 per hour and charges $4.60 for a classic single-patty hamburger, the mayo company’s decision to pay employees above minimum wage and charge more for their product has been a successful business model.

“It doesn’t make sense, especially in New York, for people to be making min wage,” said Arias. “I don’t know how anyone can live off that. Like, maybe in another state, but everything here is way too expensive.”